Homework Week 5

Homework Week 5 - losses regardless of their original...

Info iconThis preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
Homework Solutions Homework Solutions Week 5 Week 5
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Question 14-4 Question 14-4 Section 351 allows certain transfers of property to a corporation to escape taxation, thus allowing the business to incorporate tax free. This allows taxpayers to postpone any gain or loss until there is a substantive change in the taxpayer's investment, which encourages investment in start-up enterprises.
Background image of page 2
Question 14-20 Question 14-20 C corporations may select any fiscal or calendar tax year. Other forms of organization are required to adopt the tax year of their owners unless a business purpose can be established.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Question 14-22 Question 14-22 Corporate taxpayers can claim capital losses only against capital gains. Individuals may claim up to $3,000 in capital losses against other forms of income. Corporate capital loss carryovers become short-term
Background image of page 4
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 6
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: losses regardless of their original status, and they are carried back three years and carried forward five years. Problem 14-55 Problem 14-55 a. Susan has no gain or loss and her stock basis does not increase. b. The corporation has no income from the capital contribution. Its basis is zero since basis carries over. c. If Susan receives 10 percent more stock, she will have to recognize her $2,000 of realized gain since she does not meet the 80 percent control requirement. Her basis in stock equals $2,000, her cost basis. Problem 14-62 Problem 14-62 The taxable income for the year is $62,000. Capital losses are deductible only against capital gains. The $5,000 long-term capital loss is carried back three years and forward five years....
View Full Document

This note was uploaded on 12/13/2010 for the course ACC 553 taught by Professor Davey during the Spring '10 term at DeVry Irvine.

Page1 / 6

Homework Week 5 - losses regardless of their original...

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online